Calumet, Inc

Ladies and gentlemen, thank you for standing by and welcome to the Q1 2021 Calumet Specialty Products Partners LP Earnings Conference Call. At this time, all participants' lines are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance, please press star zero. I would now like to hand the conference over to your speaker, Brad McMurray of Investor Relations. Thank you. Please go ahead.

Thanks, Phyllis. Good morning, everyone. Thank you for joining us on the call to discuss our first quarter results. I'm joined today by Steve Maher, CEO, Todd Borgman, CFO, Bruce Fleming, EVP, Montana Renewables and Corporate Development, Scott Obermeyer, EVP Specialty Products and Solutions, and Mark Long, EVP Performance Brands. Before we proceed, allow me to remind everyone that during the course of this call, we may provide various forward-looking statements. Such statements are based on the beliefs of our management, as well as assumptions made by them, and in each case, based on the information currently available to them. Although our management believes that the expectations reflected in such forward-looking statements are reasonable, neither the partnership, its general partner, Please refer to the partnership's press release that was issued this morning, as well as our latest filings with the SEC for a list of factors that may affect our results. We may also reference and discuss certain non-GAAP measures. Please see the earnings press release and slides for reconciliations to GAAP financial measures. As a reminder, you may now download a PDF of the slides that will accompany the remarks made on today's call in the investor relations section of our website, www.calumetspecialty.com. A webcast replay of this call will be available on our website within a few hours. You can contact our investor relations department as needed for support. With that, I'll pass the call to Steve. Steve?

Good morning, everyone, and thanks, Brad. It's good to have you on our team. Like pretty much everyone in similar lines of businesses and geographies, our first quarter results are dominated by a single one-time event, the impact of winter storm URI and resulting production losses. Our first quarter adjusted EBITDA was negative $5.4 million. Despite these challenges, our performance brands and our specialty products and solutions segments maintained or improved unit margins despite a dramatic increase in crew prices during this quarter. This clearly continues to demonstrate our ability to minimize the impact of price volatility and continues the excellent work demonstrated by our team during 2020. In late February, our Shreveport refinery was successfully and safely completing its largest turnaround in a decade. As we prepared for the restart, URI bore down on northwest Louisiana. A 10-day hard freeze created a humanitarian disaster for the Shreveport area with loss of municipal water, roads unpassable for most of that time, food shortages, and power outages. I go into that detail to demonstrate the level of challenge presented to our teams at affected locations in Louisiana and Texas. We're really proud and appreciative of our colleagues. They worked long, long hours to fix hard freeze damage while contending with personal weather-driven challenges and in many cases also helping their communities during this time of significant need. Nevertheless, the combined impact of repair costs and volume loss affected our first quarter by an excess of $30 million. A hard freeze on an entirely cold plant presents additional challenges and results in additional damage and additional diagnosis time. Our forward-looking picture is as promising as it has been in many a year. Building on my comments on the last call, we continue to be able to sell everything we can make. Furthermore, the economy appears to have only strengthened thanks to the vaccine rollout and the and the economy reopening. Back in late 2020, our team looked forward and termed 2021 as the year of the price increase. We expected stress on the input side, be it basic feedstock costs or supply chain disruptions, and prepared accordingly. The reality was more pronounced than even we expected, but we've been able to minimize that impact. Although, like everyone, we have had at times needed to scramble to source materials and transportations, we've still been able to set records in our performance brands business, hitting our first million-gallon true fuel sales milestone in the month of January and maintain good unit margins in our specialty products and solutions businesses. Strategically, we continue to make good progress. Earlier this week, we launched the process to redeem $70 million of our 2022 unsecured notes. We also completed our business resegmentation process, recently filing an 8K, providing investors more insight and transparency, and investor feedback about these actions has been very positive. Progress on the Montana Renewables Project is more than satisfactory. The process of de-risking and beginning execution of the project is on track, and partner discussions are productive. Given the exceptional nature of this ultra-competitive project, Todd and I will get into it in more depth later in remarks, and Bruce will also be here for Q&A. So with that, I'll hand over to Todd, who will be taking you deeper into our results. Thanks, Steve.